There is an Elvis Presley Park and a John Paul II Square. There are streets named after footballers and actors, as well as others named after more unsavoury characters from the past.

But Hungary's newfound zeal for renaming its public spaces has run into trouble after a plan to honour an antisemitic writer with her own street prompted criticism of the government's name game.

Budapest council has now cancelled a resolution to name a street after Cécile Tormay, an interwar writer and Mussolini fan twice nominated for the Nobel prize for literature.

She already has a statue in the heart of Pest, the eastern half of Budapest, but plans to give her a street as well stirred up animosity triggered by the dominant centre-right government's perceived attempts to redefine Hungarian culture.

"These are part of very sweaty attempts to create a new canon of Hungarian culture," said film director András B Vágvölgyi. "They are desperately trying to find something that is not there, ie decent rightwing writers and cultural figures.

"It's different in France, for example, where Louis-Ferdinand Céline was a Nazi collaborator but wrote Journey to the End of the Night and was a fine writer."

The renaming of public areas has historically accompanied regime change in Hungary and the governing Fidesz party proclaimed a "polling booth revolution" after its achieved a landslide election victory in 2010. Government opponents say the rechristenings are part of a larger cultural overhaul spearheaded by prime minister Viktor Orban, who is in London this week meeting David Cameron, and his culture chief, György Fekete. The accusation is that they are pushing an anti-pluralistic, non-critical and nationalistic agenda.

Among the contentious figures now on the map are writers and alleged war criminals Albert Wass and József Nyírö, alongside the less divisive, such as 1950s footballer Nándor Hidegkuti and actor Imre Sinkovits. Names forced to make way have included Köztársaság tér (Republic Square), Moszkva tér (Moscow Square), Roosevelt tér and Ságvári Endre utca, a street named after a communist resistance leader who was gunned down by a military policeman during the Arrow Cross rule towards the end of the second world war.

Ferenc Kumin, international communications under-secretary for Fidesz, denies any conscious connection between the word Republic being dropped from the country's official name and Köztársaság tér being rechristened after John Paul II.

Bálint Ablonczy, a journalist at the pro-government Heti Válasz, said Tormay was popular in her day, but concedes: "Any reasonable literary historian would at best consider her a second-rate author." Kumin notes that "Tormay was nominated for the Nobel prize in 1936, while Nyírö and Wass received Baumgarten awards for their work".

On the deletion choices, Ablonczy said: "It is a completely legitimate expectation that there shall be no street names advocating the glory of a failed totalitarian regime in Hungary 25 years later." Councils all over the country agree, with scores of Lenin, Karl Marx and Red Star streets being renamed after local figures.

However, Vágvölgyi said it was not Hungary's socialist past but its liberal heritage that was being unfairly sidelined. "Fidesz's vision of culture is: 'do something different from the leftwing', and because socialism had a similar level of bad taste, its major foe is liberalism, the bourgeois radical writers of the 20s and 30s, the filmmakers. With writers like Tormay and Nyírö there is a competence problem: they aren't very good writers, a moral problem: they were Nazis and an aesthetic problem: it's bad taste."

The Budapest mayor, István Tarlós, has suspended the naming of public areas until after next year's local elections.

And how did an unnamed green Buda corner come to be known as Elvis Presley Park? Vágvölgyi said: "Elvis dedicated Peace in the Valley to the 200,000 Hungarian revolution refugees then in Austria on The Ed Sullivan Show in January 1957 and we bought the rights to it to use in my film Kolorádó Kid. So when Tarlós (who stated he has never owned a Presley record) suggested the idea and mentioned the song the following year, my friends blamed it on me."